Mortgage rates have hit the low point this year and the lowest point since June of 2013. There was a chance that much of the recent rally in bond markets had been due to the expectation that today's Fed Minutes would offer a softer side of what was seen on Sep 17. The most prevalently-quoted conforming 30yr fixed rate for top tier scenarios now is a solid 4.125%, with 4.0% coming more into the picture faster than before.

Unless you witnessed it this afternoon you would not believe some of the stuff coming from the NYSE floor. People running around into each other trying to justify why stocks rallied, and so did the bond and mortgage markets. One dude was almost screaming that these wild gyrations in the stock indexes was harming the consumer, keeping him/her from investing in stocks. It isn't like there is no one in the market but there a few that just ca not take it if there are some sweepings of money left around that they cannot get his hands on.

The stock indexes made up all of the ground lost yesterday; the key indexes ended higher than their closes on Monday. Everything we see with stock markets is bearish, the technicals, the fundamentals; however it does not matter one bit. With nowhere else to go US stocks are the light of the world now. With the dollar gaining more strength foreign investors find US investments a little more attractive, with the FOMC minutes and recent global economic forecasts declining, it seems no one wants to face it because it is better to make money than not. Like the dude I mentioned above, logic is a non-starter now; and don't give be that earnings will continue to improve much longer. Earnings have been a pleasant surprise, but in the end it is an oxymoron that economic declines lead to high earnings. The clock is ticking and the bond market knows it.

The bond and MBS markets are approaching overbought levels on all of our momentum oscillators, some retracement is likely but we believe rates will decline lower over the next month; our target is 2.25% for the 10yr and mortgage rates under 4.0%.

In summary, what a day for mortgage bonds. They started the day to the downside then went into positive territory and once again went negative after the 10 year treasury auction results only to go positive once again once the Fed minutes were released. Big intraday swings like this makes me believe traders are trigger happy and may sell to protect recent profits.

Keep a strong look at the markets and continue to cautiously float if you do want to take a risk. Remember, if you want to know the benefits of locking your rate today versus floating, simply give me a call at 314-744-7806 or visit me on my website at www.CallTheMoneyMan.com. I have access to real time Wall St. data and instant market alerts with breaking news that I monitor throughout the day to assist us on making the informed decision.